Warning Ireland most exposed in EU to Brexit
Ireland's economic exposure to the UK's exit from the EU was underlined in new data yesterday that showed the country is more dependent on the UK for exports than any other EU state.
Latest Eurostat data show that 13pc of Irish exports go to the UK annually.
Holland is the second-most exposed country, with 9pc, followed by Cyprus on 9pc.
The UK is Ireland's second-biggest export market behind the US.
However, much of the output that is shipped to the US is owned by multinationals, meaning it has limited economic impact in Ireland.
Meanwhile the Association of Chartered Certified Accountants has said that Irish small and medium enterprises (SMEs) will be the biggest losers as a result of Brexit if action is not taken by the Government to safeguard the sector.
The ACCA said that many small and medium businesses were already struggling because of the loss of value in sterling, adding that such businesses would not have the resources to deal with any new customs charges.
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"Small businesses are facing growing economic challenges with the triggering of article 50 and in particular companies that have between 10 and 250 employees are most exposed," said Liz Hughes, head of Ireland and mainland Europe at the ACCA.
The warning comes just a day after a survey the Irish Small and Medium Enterprises Association (Isme) showed almost half of Irish SMEs expect turnover to drop this year as a result of Brexit.
The profound impact Brexit could have on Irish businesses was emphasised by the fact that 48pc of companies believe profitability will suffer decreases in the year ahead because of events stemming from Brexit.
Further data released on Wednesday showed that tourism from the UK has declined by 5.9pc in the three months to March of this year. Currency fluctuation and wider Brexit uncertainty were cited as the primary reasons for the drop.
In addition, the need for Irish firms to diversify into different export markets was highlighted in a new report that expects the UK to leave the EU without having agreed a deal on trade by 2019.
That would be the worst possible outcome for many indigenous Irish companies whose main export market is the UK. The report from financial experts PwC stated that Irish businesses need to plan for an outcome in which trade tariffs between the UK and the EU are dictated by the World Trade Organisation.
"Whilst the ill-winds of Brexit may appear to be some way off, it would be foolish to ignore them. Irish companies trading with the UK now need to start planning for a World Trade Organisation regime post March 2019," said David McGee, PwC Ireland Brexit Partner.
"Reasonable assumptions can be made, estimates can be calculated and the risks can be assessed," Mr McGee added.